Grassley on Ernst & Young's Tax Shelters Agreement
M E M O R A N D U M
To: Reporters and Editors
Re: Ernst & Young tax shelters agreement
Da: Wednesday, July 2, 2003
Sen. Chuck Grassley, chairman of the Committee on Finance, made the following commenton today’s announcement by the Internal Revenue Service of an agreement with Ernst & Young,LLP, resolving issues relating to an examination of Ernst & Young’s compliance with theregistration and list maintenance requirements regarding the firm’s marketing of tax shelters.
“Violating tax shelter rules shouldn’t be a negotiable offense. That the IRS had to negotiateErnst & Young’s compliance underscores the need to pass the Grassley-Baucus shelter legislation.We expand the shelter registration and customer list requirements and establish stiff penalties fornoncompliance.
“It shouldn’t surprise anyone that Ernst & Young is so deeply involved in tax shelters.Unfortunately, Ernst & Young isn’t alone. We continue to hear about tax shelters being promotedby other accounting firms, law firms, and investment banks. Ernst & Young distributed a videoWebcast promoting corporate expatriations in the wake of the post-September 11th stock marketslide. I just hope a $15 million penalty is large enough to get their attention.”
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